Stop limit is a conditional trade to buy and sell crypto that functions over the feature to stop the loss over a set limit price. Buy/sell limit order gets triggered once price reaches specified “stop price”. It is an important feature to minimize loss from the trade.
There are 3 components to stop limit feature in the app:
- Quantity - Amount(fiat) or quantity(crypto) to buy/sell for stop limit order.
- Stop Price - When the last traded price reaches a given stop price, stop order(buy/sell) will be triggered at the specified limit price.
- Limit Price - Price at which stop limit order (buy/sell) will be placed in the order book.
Example: If you have bought 1 BTC at 3500 EUR, you will hold it for profit but you may want to exit position at 3400 EUR. If the price goes at same or below that level, then you need to place a sell stop limit order with the limit price at 3400 EUR and stop price at 3405 EUR. Once limit price reaches 3405 EUR, it will automatically trigger your BTC sell order at 3400 EUR.
Stop limit is useful from preventing excessive losses and secure way to automate orders without constant watch at markets. Please note:
- Buy stop limit order gets triggered when the last traded price reaches or exceeds the stop price of the order. Sell stop limit order gets triggered when the last traded price reaches or falls below the stop price of the order.
- For a buy stop limit order, the limit price must be greater than or equal to stop price. For a sell limit order, the limit price must be less than or equal to stop price.
- For a buy stop limit order, stop price will be greater than the last traded price. For a sell stop limit order, stop price will be less than the last traded price.
- Stop limit order will be converted to normal limit order once it gets triggered.
To use stop limit feature in-app, tap on trade and select crypto you want to trade. Below ticker, select “stop limit”. Follow the aforementioned steps to set your stop limit buy/sell order.
